TSMC plans to build 18-inch wafer plant in 2016
Central News Agency
2012-10-24 06:25 PM
Taipei, Oct. 24 (CNA) Taiwan Semiconductor Manufacturing Co. (TSMC), the world's largest contract chip maker, is planning to build an 18-inch wafer plant in 2016 that will focus on development of chips on the advanced 7 nanometer technology process. TSMC bought two pieces of land Tuesday from the Miaoli County government for more than NT$3.2 billion (US$109 million) for the construction of the new wafer plant. The location of the new plant will be close to the Hsinchu Science Park, where the chip maker is headquartered. Following the completion of the construction, TSMC is expected to install production equipment in 2017, the company said. However, TSMC did not give any indication about the total investment in the 18-inch wafer plant. As each of the three 12-inch wafer plants the company is operating cost more than NT$100 billion, the investments in the new plant are expected to be much higher. The 7 nm process is more sophisticated than the 20 nm process TSMC applies for trial production and more advanced than the 28 nm process the company is using for mass production. In the second quarter of the year, chips on the 28 nm process accounted for 7 percent of TSMC's consolidated sales. On Thursday, TSMC is scheduled to release its third quarter earnings and give a sales guidance for the fourth quarter. Daiwa Securities said it expects TSMC to report NT$1.89 in earnings per share for the third quarter, compared with NT$1.61 recorded in the second quarter after the chip maker's consolidated sales beat its expectations to total NT$141.38 billion which rose 10.4 percent from the second quarter. In a research note, the brokerage said the third quarter could be a peak for TSMC in terms of earnings and sales, adding the company will be affected by inventory adjustments during the period. Daiwa Securities said TSMC's third quarter sales are likely to fall about 10 percent from the previous quarter. Daiwa Securities said TSMC's capital expenditure for 2013 is expected to total US$10 billion and the figure is likely to rise to US$10.5 billion in 2014, compared with US$8 billion-US$8.5 billion planned for 2012. The brokerage has maintained a "holding" recommendation on TSMC shares and raised a target price on the stock to NT$91.8 from NT$89.50. Shares of TSMC closed down 0.35 percent at NT$85.40 on the Taiwan Stock Exchange Wednesday. (By Jackson Chang and Frances Huang)
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